Chicago | Reuters — U.S. wheat futures neared a one-month high on Wednesday on short-covering and poor weather in Australia and the Black Sea region that worried traders who have recently been focused on large global supplies.
Corn and soybean futures ended little changed.
Propelling wheat prices higher was dry weather that is threatening the 2016 grain harvests in Ukraine and Russia, both major wheat exporters that are currently sowing their winter crops.
In Australia, another major wheat exporter, traders feared that crops may have suffered some frost damage.
Chicago Board of Trade December wheat jumped 12 cents to $5.07-1/2 a bushel after trading up to $5.08-1/2, the highest price for a front-month contract since Aug. 25 (all figures US$). The contract has climbed 11 per cent since reaching a five-year low on Sept. 4.
Prices have recently been under pressure because export demand for U.S. wheat has been sluggish due to competition for business from other countries offering cheaper supplies. The recent rally makes it more difficult to compete, analysts said.
“Remember that world wheat values are not climbing,” said Rich Feltes, head of market insights for broker RJ O’Brien.
December corn rose 2-3/4 cents, to $3.83-1/4 a bushel.
November soybeans ended up two cents, to $8.63-3/4 a bushel, after falling to $8.61 earlier in the session, matching a 6-1/2 year low first reached on Tuesday.
U.S. soy exporters have faced their slowest sales in seven years for their new crop this year as huge South American supplies and a strong dollar have been crimping demand for U.S. shipments.
However, private exporters struck deals to sell 284,500 tonnes of U.S. soybeans to China, the world’s top importer of the oilseed, during the marketing year that began on Sept. 1, the U.S. Agriculture Department said.
On Thursday, a Chinese delegation will likely sign deals to buy several million tonnes of U.S. soybeans in Iowa as part of a trade delegation.
— Tom Polansek reports on agriculture and ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Michael Hogan in Hamburg and Naveen Thukral in Singapore.